PAM_334_Fall_2008_Lecture_11 - PAM3340 Lecture11 Agenda:

Info iconThis preview shows pages 1–6. Sign up to view the full content.

View Full Document Right Arrow Icon
PAM 3340 Lecture 11 Agenda: Corporation as a dynamic, equilibrating  mechanism The economics of corporate control Agency effects of corporate control  transactions Takeover law
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
The Corporation as a Dynamic  Mechanism We have thought of the corporation as  essentially unchanging across time In reality, the corporation is  dynamic almost constantly changing In particular,  the boundaries of the firm  are frequently changing  
Background image of page 2
The Corporation as a Dynamic  Mechanism (con’t)  In law, corporation is a legal person, like  an individual Better to think of the corporation as an  economist would: as an “equilibrating  mechanism”  A market is one example of an  equilibrating mechanism (maximizing  total surplus)
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
The Corporation as a Dynamic  Mechanism (con’t) Think of the corporation as always  headed toward an equilibrium Maximizing shareholder value
Background image of page 4
Mechanism (con’t) Boundaries and structure of the firm can  of that change How can the corporation change form? Mergers
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 6
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 19

PAM_334_Fall_2008_Lecture_11 - PAM3340 Lecture11 Agenda:

This preview shows document pages 1 - 6. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online